Yes! If you are eligible for the disability tax credit, you are also eligible for a Registered Disability Savings Plan, and you should earnestly consider taking advantage of it.
The federal government provides grants and bonds through this account type with a potential for up to $90,000 for you or your loved one living with a disability!
The Canada Disability Savings Grant matches your contributions on a sliding scale depending on your income and how much you contribute, up to 300%, with a minimum of 100% and an annual grant limit of $3,500. The lifetime limit of this grant is $70,000.
If your income is less than a certain threshold, you may also be eligible for the Canada Disability Savings Bond. The potential limit is $1,000 annually, with a lifetime limit of $20,000. No contributions are necessary to receive this grant; you get it just for opening the account.
More good news, you can backdate both grants, meaning if your income were lower when you became disabled, EDSC would account for those lower-income years first.
A final caveat, contributions to your RDSP must remain within that account for ten years to keep the grants and bonds. This may sound lousy, but it serves as a great incentive to use the RDSP funds for your retirement when your additional expenses may increase.
Another opportunity: you can invest your RDSP contributions, grants and bonds. Considering the 10-year holding period, you certainly want to ensure you’re at the very least keeping up with inflation.
If you live with a disability or know someone who is, and you’re interested in opening an RDSP, please feel free to reach out, and we’ll walk you through the process of getting started.